Drexler Technology Finalizes Acquisition of Two German Card Companies
Mountain View, Calif., April 1, 2004–Drexler Technology Corporation (NasdaqNM:DRXR) announced that on March 31, 2004, it successfully concluded the acquisition of two related German card companies, Challenge Card Design Plastikkarten GmbH of Rastede, Germany, and cards & more GmbH of Ratingen, Germany, including their sales operations in the USA and Korea.
These acquisitions provide Drexler with a strong card manufacturing base to serve the European, Middle Eastern, African, and Asian markets, supplementing the Company’s newly expanded manufacturing operations in California. The Company is in the process of enhancing the existing Challenge Card Design factory in order that finished optical cards may be manufactured in Germany. This will introduce the world’s first full-service card manufacturing facility ready to supply cards featuring the key technologies demanded by the market–optical memory, contact IC chip, contactless RF ID, and magnetic stripe, as well as many other high security features–either singly or in combination.
The addition of cards & more GmbH also enhances the sales and marketing base for the Company’s European, Middle Eastern, and African (EMEA) operations, as well as providing a strong regional systems integration capability.
This strategic move will position the Company and its wholly owned subsidiary, LaserCard Systems Corporation, to build on their current pre-eminent position in the secure, biometric-based ID market in North America. Cards & more will continue to serve and support its existing customer base, while adding new resources to build optical memory card business throughout the EMEA region. In expanding its European presence, the Company intends to focus principally on biometric ID solutions for national and regional governments, as well as promoting optical cards in commercial and industrial markets which can benefit from the large data capacity and robust security that optical cards offer.
In the acquisition transaction, Drexler Technology agreed to assume approximately 500,000 Euros of debt and to pay approximately 4.75 million Euros in cash, consisting of approximately 2.25 million Euros payable at closing and the remaining approximately 2.5 million Euros payable in five equal annual installments, subject to certain future adjustments. The acquired German companies have a total staff of approximately 70 people. More detailed profiles of the German companies are contained in Drexler’s November 19, 2003 news release concerning the initial Letter of Intent for this transaction.
Headquartered in Mountain View, Drexler Technology Corporation (http://www.drexlertechnology.com) manufactures LaserCard® optical memory cards, chip-ready optical memory cards, and other computer-based cards. Drexler’s wholly owned subsidiary, LaserCard Systems Corporation (http://www.lasercard.com), manufactures optical card read/write drives; develops optical card system software; and markets optical cards, card-related data systems, and peripherals.
Forward-Looking Statements: All statements contained in this press release that are not historical facts are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are not historical facts or guarantees of future performance or events. Rather, they are based on current expectations, estimates, beliefs, assumptions, and goals and objectives and are subject to uncertainties that are difficult to predict. As a result, our actual results may differ materially from the statements made. Often such statements can be identified by their use of words such as may, will, intends, plans, believes, anticipates, visualizes, expects, and estimates. Forward-looking statements made in this release include statements as to our enhancing the German card manufacturing facility and the resulting capabilities we expect to obtain; the planned actions of cards & more GmbH; and the Company’s European focus. These forward-looking statements are based upon our assumptions about and assessment of the future, which may or may not prove true, and involve a number of risks and uncertainties including, but not limited to, whether we will be successful in enhancing the German manufacturing facility; whether cards & more will be able to achieve its plans; and whether our focus will prove successful; as well as other risk factors detailed in the Company’s Form 8-K, 10-K, and 10-Q filings with the Securities and Exchange Commission. Due to these and other risks, the Company’s future actual results could differ materially from the Company’s expectations. These forward-looking statements speak only as to the date of this release, and, except as required by law, we undertake no obligation to publicly release updates or revisions to these statements whether as a result of new information, future events, or otherwise.